12/23/08 — Automobile industry concerns might affect some county manufacturers

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Automobile industry concerns might affect some county manufacturers

By Steve Herring
Published in News on December 23, 2008 1:46 PM

Washington, D.C., Detroit and the economic maelstrom swirling around the Big 3 automakers is more than a political football for the approximately 1,428 Wayne County jobs tied to the automotive industry.

The local investment of those companies is "significant," probably $100 million or higher, said Mike Haney, existing industry specialist with the Wayne County Economic Development Alliance.

In a recent interview County Manager Lee Smith said Wayne County workers and officials are watching to see what happens next.

"There is a lot of fear out there," Smith said. "We have people here who build things for the automotive industry so we all are kind of standing back holding our breaths about that. When you watch the Congress hearings about GM and Chrysler, that affects Wayne County."

Efforts to secure a rescue plan were wrecked by the Senate, but President George Bush last week announced a $17.4 billion package for Chrysler and General Motors.

Ford also is experiencing money woes, but company officials said the company is not in as dire need of short-term relief as GM and Chrysler.

Locally, dealerships have said their businesses are off by about 25 percent.

For the most part, the companies that make automotive parts, including Cooper Standard Automotive, Cooper Bussman and Uchiyama America did not return phone calls for comments on if or how they have been affected by the crisis.

The exception was AP Exhaust Products, an aftermarket producer of complete exhaust systems and catalytic converters that is not affected by the Big 3. Cooper Standard officials referred comments to their corporate office, however a spokesperson could not be reached.

"The Big 3 don't affect us, we don't sell to them," said Vange Proimos, AP Exhaust Products plant manager. "Overall, the economic downturn has affected companies and everybody is being cautious, trying not to spend any money. Eventually our business should be better."

Because of the economy, people are keeping their vehicles longer and spending to keep them running rather than buying new, he said.

The company has 275-300 employees including some temporary workers.

The county is in the process of adding another aftermarket company. Triangle Spring is headed to Mount Olive and is in the aftermarket business making springs for truck suspensions.

"We feel fortunate to have them," Haney said.

"I think that the nature of the automotive industry being what it is, it is easy to track," Haney said. "The way subcontractors for the automotive industry work is when one of the automotive manufacturers places a production order, the companies gear up to meet the demands."

The industry, he said, always seems to be contracting and expanding with companies having just-in-time manufacturing.

The work force has several components including employees indirectly associated with automotives like management and accounting. Then there are the direct personnel who actually do the work.

In some cases, the companies have a core of permanent workers. As the business expands, temporary workers are hired. As the business contracts, the temporary workers are let go.

The core workers are high-skilled positions that the companies try to protect, Haney said.

There is a trickle-down effect and companies look for innovative ways to curtail costs, he said.

Haney said he does not know specifically at this point how the crisis has affected the bottom lines of local companies.